Generic Strategies

Air Asia  was named the World’s Best Low Cost Airline in the annual World Airline Survey by Skytrax for five consecutive years in 2009, 2010, 2011, 2012 and 2013 and has been ranked Top 5 among the most recognised and admired airlines in the Asia Pacific Top 1000 Brands 2008. Air Asia is set to take low-cost flying to an all new high with belief, "Now Everyone Can Fly". 

This example already explain about the topic that I had learnt today. Air Asia company is included in one of the Generic Competitive Strategies. So, the topic today is Generic Competitive Strategies. There are five strategies which are :

1) Low cost provider

2) Broad differentiation

3) Focused low-cost

4) Focused differentiation

5) Best-cost provider.

LOW COST PROVIDER

The company is striving to achieve the lowest cost compared to their rivals or competitors. In order to be a low-cost provider, the company must pursue cost saving and avoid reducing product quality to unacceptable levels. Successful low-cost leaders, who have the lowest industry costs, are exceptionally good at finding ways to drive costs out of their businesses and still provide a product or service that buyers find acceptable.

When a low cost provider strategy works best, :

1. Price competition among rival sellers is vigorous.
2. Identical products are available from many sellers.
3. There are few ways to differentiate industry products.
4. Most buyers use the product in the same ways.
5. Buyers incur low costs in switching among sellers.
6. The majority of industry sales are made to a few, large volume buyers.
7. New entrants can use introductory low prices to attract buyers and build a customer base.

  nb

      

             Regarding to the task that had been given in GOALS, here are the answers.and i am using The Five Generic Competitive Strategies as stated in the textbook.
             
              AIR ASIA

          -Low cost Provider

Low cost provider means striving to achieve lower overall costs than rivals on products that attract a broad spectrum of buyers. This situation can be seen clearly at Air Asia tagline 'Now Everyone Can Fly'. Air Asia can be provide the lowest price due to they are regional airline serving Malaysia and south-east asian destinations. Provides flight, planes, corporate information and online booking. They just provide the things that is NEED for consumers but still customers need to pay if they want some add-on.

     

               PROTON
       
         - Low cost Provider

            Compared to other company, Proton provide affordable price especially for all Malaysian due to the level of life. As an example, just take a look on the picture below,

Proton Saga

           
AIR     Saga is is sedan typical, but yet they can provide low cost price for Malaysian and without taking so much care about what consumer social class is. It is for all and right, for a broad spectrum of buyers.

           
              TESCO
       
         - Low cost provider

 The tagline of 'Because we care' was really in Malaysian hearts and their Principe is ''The way we work is how we deliver Every Little Helps to make Tesco a better place to shop and work in. We use simple processes so that shopping is BETTER for customers, work is SIMPLER for staff and things are CHEAPER in Tesco.'' Moreover they also produce or package their own  product. So, this is the main clue how they want to cut their cost to give the best price for consumers. Extra benefit at Tesco is the provide delivery service and also Tesco club point. This is their way to have a loyal customers. 

p/s; I also have a Tesco club point :)

  MYDIN

- Low cost provider

MYDIN business activity is in retailing and wholesaling. While their vision is MYDIN is the world's leading distributor of competitive "Halal" goods and services. They can sell their product at a very low price because they sell they things in large quantity. Large quantity cheaper price! :) Mydin also have link with government.

GIANT

-Low cost provider

In Malaysia, Giant is synonymous with everyday low prices, big variety and great value and recognised for offering the most vibrant, comfortable and complete shopping environment. Moreover, for the consumer, Giant has thrown its weight fully behind the Malaysian Government's programme to create smart consumers of Malaysians through continuous marketing innovations, which help them seek out the best value deals. In the past few months, Giant collaborated with the Government to launch numerous campaigns that effectively brought prices of daily essentials and consumables to even lower levels, including a Price subsidy campaign for Fresh Produce. As the leading hypermarket chain in Malaysia, this campaign was a first of its kind in the industry. Therefore, this situation has already prove Giant is the low cost provider.

DIGI

-Low cost provider

          Digi is one of the telco company that compete with other company and provide low cost and high value for customers. for example, take a look at their rate, dont you think they have a very lowest fare for the customers?! moreover, they also provide '1 pakej komuniti with belia'. this the way they want to attract new customers by co-operate with goverment.

Promotion to attract consumers

          KAMDAR

         -Low cost provider
        
        Kamdar is one of the company that sell silk  and  specialize in textile fabric, furnishing fabric, in-house designed garments for ladies, men and children’s clothes, Indian clothing and school uniforms. Kamdar sell their product at reasonable price with high quality and friendly customer service at their shop. For example, 

week 4 of the lecture! :)

Today's lesson is about Evaluating a Company's Resources, Capabilities, and Competitiveness. In this chapter we discuss about techniques for evaluating a company's internal situation, including its collection of resources and capabilities and the activities it perform along the value chain. This is the summary.

So, what is the best indicator to see how well the company's strategy is working? The some of the answers are :

1) whether the company is acquiring new customers at an attractive rate as well as retaining existing customers.

2) whether the firm's image and reputation with its customer is growing stronger or weaker

3) whether the company's overall financial strength and credit rating are improving or declining.

Move to the other part that Dr Ummi highlight, the meaning of resources is a productive input or competitive asset that is owned or control by the firm. this can be tangible and intangible assets in the company. Plus, competitive advantage is also important. Competitive Advantage means the uniqueness of the product that your company alone had.

Moreover, by using SWOT analysis, it can help to determine whether the company able to seize market opportunities and nullify external threats. SWOT analysis is a powerful tool for sizing up a firms :

1) Internal strength

2) Internal weaknesses

3) Market opportunities

4) External threats

The concept is just same like Muslims doing 'muhasabah' on her/his self. Even, Dr Ummi also doing that 'muhasabah' in the lecture. I also take part on that activity. So, here is my strength and weaknesses.

This is Wahibah

Try to change muhasabah for oneself for the company. SWOT analysis will match its strategy to its internal strengths and to market opportunities. Plus, SWOT analysis will correct important weaknesses and defend it against external threats.

There is one other thing that is primary in this chapter that is VALUE CHAIN. The value chain identifies the primary internal activities that create and deliver customer value and the requisite related support activities.

Thank you for reading. :)